Japan's proposed `iPod tax' might amount to naught

AP , TOKYO

A Japanese government committee is mulling a copyright law revision to charge royalties on digital music players, but the opinion is so divided on the so-called "iPod tax" that it isn't likely to be charged, officials said yesterday.

Japan already levies an extra fee for copyrights on gadgets sold in stores such as mini disk recorders that consumers can use for home copying of music. That charge, generally 3 percent of the product's wholesale price, is included in the price tag so most shoppers aren't even aware they're paying it.

The money from such copyright royalties, totaling some ¥2.2 billion (US$19 million), is collec-ted by an organization set up especially for that purpose and doled out to intermediary groups who in turn pass it along to recording companies, composers and other artists.

Since it's impossible to really know what tunes were copied in homes, the groups hand out an estimated payment according to a sample survey on how music sold that year, says Toru Takeda, a copyright official at the Cultural Agency, which set up the committee.

Since last year, recording companies and other lobbies here have been grumbling that the same system should be applied to recording devices with hard-drives, including MP3 players like Apple Computer Inc's iPods as well as possibly flash-memory players.

In January, a committee was set up to debate the issue, Takeda said.

But the panel, made up of academics, consumer-rights activists and other experts, is so divided on where to draw the line on what constitutes copyright infringement, it is highly unlikely to come up with an agreement by the December deadline.

The possible new charge has been dubbed the "iPod tax" by the Japanese media, although the money doesn't go to the government.

Apple in Japan said it was not in a position to comment on government committee discussions.

The iPod has been a big hit in Japan, with the trademark white earphones rapidly becoming a fashion statement everywhere. Japanese downloaded 1 million songs in the first four days after the iTunes online music store opened in Japan.

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